Rand dips as Marcus quits

19 September 2014 - 02:09 By TJ Strydom
South-African Central Bank Governor Gill Marcus. File photo.
South-African Central Bank Governor Gill Marcus. File photo.

After five years at the helm, Reserve Bank Governor Gill Marcus is stepping down.

"I have advised the president that I would not be available for renewal," Marcus said yesterday after announcing what is likely to be her last interest rate decision.

Interest rates will remain unchanged and a new Bank governor will be in place when the monetary policy committee next meets in November.

The Presidency said yesterday that Marcus's term expires at the end of November, but she said she would leave earlier that month.

Marcus did not reveal who would succeed her as head of the monetary policy committee. She said the decision lay with President Jacob Zuma and she expected him to make an announcement soon.

Zuma's office said yesterday that an announcement would be made "in due course".

He would have to make it snappy because Marcus leaves the bank on November 8, and the next meeting starts on November 18.

A safe pair of hands at the Bank is important for stability, Investment Solutions strategist Chris Hart said yesterday.

Shortly after Marcus made her announcement, the rand exchange rate dipped as low as R11.10 against the dollar from R11.04, but recovered some lost ground in later trading.

"The president has a very strong talent pool to choose from inside the bank," Marcus said. She said she was "comfortable" Zuma would make the right choice.

Hart believes joint deputy-governor David Mminele will be the front-runner to succeed Marcus.

But it could just as easily be Lesetja Kganyago, the second deputy-governor, he said.

"One needs someone with technical knowledge, rather than just a political appointee."

Marcus announced yesterday that the repo rate would remain unchanged at 5.75% and prime at 9.25% on the back of slightly lower inflation expectations and "anaemic" economic growth.